In a surprisingly welcome decision, Chancellor Osborne has
announced that Mark Carney will become Governor of the Bank
of England effective after Mervyn King's term ends in June
2013. This came as a surprise only because he had appeared to
repeatedly rule himself out of the role, rather than him being in
any way under-qualified. His central banking experience comprises
two stints at the Bank of Canada, including his current
Governorship, which he will be giving up to join the BoE. Mark
Carney also serves as Chairman of the Financial Stability Board,
which will have provided greater exposure to the global agenda
that is inextricably linked to the UK's domestic one.
Moreover, his 13 years at Goldman
Sachs included a stint as co-head of sovereign risk.
With the euro area‟s sovereign debt crisis still raging on the
UK‟s borders, such familiarity with the market perspective could
be invaluable. The only potential negatives we see are ones of
perception rather than substance. Specifically, how the
proliferation of ex-Goldman's bankers assuming senior
policymaking positions around the world may feed popular
mistrust, and how Mr Carney's willingness to leave previous posts
may reflect a lack of commitment to each job.